Accounting Treatment & Capital Gain
This query is : Open
Sandeep Kumar Agarwal
(Querist)
21 June 2010
There are two person i.e. Mr. X and Mr. Y. both having only one Machine each as Fixed Assets. The value of Machine belonging to Mr. A on 1.4.09 was Rs. 100000/- & that of Mr. B was Rs. 70000/- at the same date. On 1.10.2009, they have decided to exchange their machine to each other.There is no other consideration.
Now,what will be appropriate accounting treatment for the above transaction in the books of Mr. A & Mr.B.????(Is their any "AS" prescribed for the same)
Further, is their any capital Gain/loss as per provisions of Section 50 of IT Act,1961 ???
Now,what will be appropriate accounting treatment for the above transaction in the books of Mr. A & Mr.B.????(Is their any "AS" prescribed for the same)
Further, is their any capital Gain/loss as per provisions of Section 50 of IT Act,1961 ???
CA Sanjeev Kr Jain
(Expert)
23 June 2010
if the machines are held as business assets and depriciation is being provided than there would be no gain because the block of assets remain in the books.
machine is also not a capital assets hence there would be no capital gain as well as capital loss.
machine is also not a capital assets hence there would be no capital gain as well as capital loss.
Sandeep Kumar Agarwal
(Querist)
24 June 2010
At which value "A" should record the new machine in his books ?????
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